What is illegal fund raising？ Do you understand？
According to the Regulations on Prevention and Disposal of Illegal Fund-raising, illegal fund-raising refers to the act of absorbing funds from unspecified objects by promising to repay the principal and interest or giving other investment returns without the legal permission of the the State Council financial management department or violating the national financial management regulations.
Illegal fund-raising behavior
The following three elements are required at the same time
01
Illegality:
Without the legal permission of the financial management department of the State Council or in violation of national financial management regulations.
02
Lure:
Promise to repay the principal and interest or give other investment returns.
03
Sociality:
Absorb funds from unspecified objects.
What are the means of illegal fund-raising?
01
Promise a high return
In order to attract the masses to be fooled, criminals fabricated the false myth of "becoming rich overnight" and lured and promised investors high returns through profiteering. At the same time, in order to defraud more people to participate in fund-raising, the promised principal and interest are often paid in full and on time in the initial stage of fund-raising, and after the fund-raising reaches a certain scale, the funds are secretly transferred or absconded with the money, causing economic losses to the fund-raising participants.
02
Fabricate a false project
Most criminals fabricate false projects to defraud the public trust by registering companies or enterprises that seem to operate legally, under the guise of responding to national industrial policies and carrying out entrepreneurial innovation. Promise high fixed income to defraud the public investment.
03
False propaganda
In order to cheat the public’s trust, criminals often spend a lot of money on propaganda. They employ celebrity endorsements, publish interview articles in newspapers, hire people to distribute leaflets widely, and make social donations, etc., to increase publicity, create false momentum and cheat the public’s investment.
04
Use affection to trick.
Some illegal fund-raising participants, in order to complete or increase their own performance, use family ties to fabricate lies about their high returns and attract relatives, friends, classmates or neighbors to join them, so that the participants spread rapidly and the scale of fund-raising continued to expand.
How can individuals prevent illegal fund-raising?
"Look, think and wait all night"
Contributed by: District Enterprise Financing Service Center
Original title: "What is illegal fund raising? Do you understand? 》
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